Income Tax
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Income Tax
Tax matters can be complicated and confusing. We can eliminate the hassle for you to understand the tax implications of any proposed decision.

Every individual who is liable to tax is required to declare his income to IRBM. The taxpayer is responsible for:

  • Declaring income and claiming expenses
  • Computing income tax payable
  • Keeping records for audit purposes
  • Paying the income tax payable

Preparation and filing of tax returns – compliance services

  • Form B (Personal tax with business income)
  • Form BE (Personal tax with employment income)
  • Form P (Partnership)
  • Form M (Personal tax for non-resident)

Tax consulting and planning

Tax appeals/refunds

      
  • Preparation and filing of tax returns – compliance services
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  • Tax consulting and planning
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  • Tax appeals/refunds

Withholding tax is an amount withheld by the party making payment (payer) on income earned by a non-resident (payee) and paid to the Inland Revenue Board of Malaysia.

'Payer' refers to an individual/body other than individual carrying on a business in Malaysia. He is required to withhold tax on payments for services rendered/technical advice/rental or other payments made under any agreement for the use of any moveable property and paid to a -resident payee.

'Payee' refers to a non-resident individual/body other than individual in Malaysia who receives the above payments.

Withholding Tax Deduction (detail)

The Income Tax Act, 1967 provides that where a person (referred herein as "payer") is liable to make payment as listed below (other than income of non-resident public entertainers) to a non-resident person ( NR payee), he shall deduct withholding tax at the prescribed rate from such payment and (whether such tax has been deducted or not) pay that tax to the Director General of Inland Revenue within one month after such payment has been paid or credited to the NR payee.

Payment TypeIncome Tax Act 1967Withholding Tax Rate
Contract Payment Section 107A (1) (a)
& 107A (1) (b)
10%, 3%
Interest Section 109 15%
Royalties Section 109 10%
Special classes of income: Technical fees, payment for services, rent/payment for use of moveable
property
Section 109B 10%
Interest (except exempt interest) paid by approved financial institutions Section 109C 5%
Income of non-resident public entertainers Section 109A 15%
Real Estate Investment Trust (REIT) Section 109D  
  (i) Other than a resident company   10%
  (ii) Non Resident company.   25%
  (iii) Foreign investment institution (effective from 01/01/2007)   10%
Family Fund/Takaful Family Fund/Dana Am Section 109E  
  (i) Individual and other   8%
  (ii) Non Resident Company   25%
Income under Section 4(f) ITA 1967 Section 109F 10%